75% of the US stock market growth of the past few years has come from AI, but that was built on a promise. That AGI was just around the corner. Now companies like OpenAI are pivoting to selling ads and porn, a sure sign they do not think AGI is about to arrive.
If the AI bubble bursts, what happens afterwards?
I’d guess there will be a backlash against Big Tech. Perhaps 2025 is the high watermark of their political influence. AI is already broadly unpopular with many people, and that will only grow when they see if it has crashed the economy and their pensions.
AI, the technology, will still be with us, even if many of today’s AI companies won’t be. Even without AGI, it still has the potential to be transformative and economically disruptive. Rules-based businesses — legal, accounting, transaction, and claims processing could all be made obsolete. Humanoid robotics and self-driving, both aspects of AI, will eventually replace millions of human workers.
The AI bubble crashing would mean a recession. Recessions mean companies cut workforce numbers. Ironically, this time, they will be able to replace many of those people who were let go with AI. So the crash that AI causes will also speed its adoption.
So many false assumptions. What’s currently called AI is exclusively LLMs and those can’t accomplished anything without very close supervision. The fact that they need close scrutiny of their every output makes their productivity gains quite small if there are any. Recent studies have shown that e.g. in the one area where you might expect them to perform well, programming, they lead to a net slowdown.
When they bubble finally pops well be left with what’s mostly an amusing toy with very, very limited use cases outside of cheap entertainment.
There will be immense financial repercussions that will have to be shouldered by the general public, as usual. The companies and executives will move on to the next hype after a while.
Why would you expect LLMs to be good at coding?
The richest will just accumulate more wealth while rest of us will have even less due to getting laid off, having to sell assets for less than they are worth and having take debt to survive